Tax Season Is Back -- and So Is This Annoying Phone Scam

With tax season coming up, the Treasury Department has renewed its warnings about the tax collection scam, one of the largest in the country. Here's how it works: the scammer calls pretending to be an IRS agent pursuing back taxes. He demands immediate payment either through a pre-loaded debit card or a wire transfer and threatens jail time, government seizure, deportation and other dire consequences. Often, according to an IRS warning, "the caller becomes hostile and insulting."

%VIRTUAL-pullquote-The truth is the IRS usually first contacts people by mail -- not by phone -- about unpaid taxes.%The scam has hit every state in the country and works by spoofing the IRS's phone number, making it appear as though the call were actually coming from the government. Callers invent fake names and badge numbers, and often know personal details such as the last four digits of their target's social security number. This all creates an air of legitimacy for when the scammer ultimately makes his demands.

In all of these details, however, the con artists miss one important thing: the IRS doesn't start collections with a phone call.

"The truth is the IRS usually first contacts people by mail -- not by phone -- about unpaid taxes," according to a notice from the Treasury Inspector General's Office warning about the scam. In fact as a general rule, several letters will arrive before anyone at the desperately understaffed agency picks up a phone. This is a call you can hang up on safely.

"If someone unexpectedly calls claiming to be from the IRS and uses threatening language if you don't pay immediately, that is a sign it really isn't the IRS calling," says the notice from the Treasury Inspector General's Office.

Still, getting a threatening phone call that claims to be from the government is pretty scary. Here are a few red flags if you ever get this call:

Asking for payment over the phone -- A legitimate IRS agent will never do this.

Asking for a pre-paid debit card, credit card numbers or banking information -- A legitimate IRS agent will never request this information over the phone.

Calling for first notice of a debt -- The IRS makes first contact by mail.

Threatening punitive action -- On first notice of a debt the IRS sends a simple bill. The threats come later.

Don't hesitate to hang up if you get suspicious. The real IRS will always follow up later. Here's what to do if you get a call like this:

Hang up and call the IRS back at its main number, 800-829-1040.

If you haven't first received a bill by mail, call the Treasury Inspector General's Office at 800-366-4484.